MST-Department of Economic Theory

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Browsing MST-Department of Economic Theory by Author "Gachanja, Paul Mwangi"

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    An efficiency analysis of hospitals owned by faith based organisations in Kenya
    (2014-08-01) Kinyanjui, George Kariuki; Gachanja, Paul Mwangi; Muniu, J. M.
    The desired goal for Kenya's Vision 2030 and the millennium development goals is to provide efficient and reliable healthcare that will reduce child mortality rates, improve maternal health and ~ombat HIV/AIDS, Malaria and other diseases by the year 2015. Kenya's health care sector has been among the most inefficient in the world characterized by high disease prevalence, high mortality rates, low life expectancy, and poor access to healthcare services and corruption. Addressing the above challenges and attaining the millennium development goals on reduction of child mortality rates, improvement of maternal health and combating of HIV/AIDS makes efficiency in health care services delivery a requisite obligation in addition to sound government policies and stakeholder goodwill. Hospitals owned by the faith based organizations are a vital component of health care institutions in Kenya. They form a key component of the private sector healthcare provision with about 40 percent dominance. The operations of these hospitals depend on donor funding, user fees and government subsidies. Dwindling donor assistance, falling government subsidy, poor human resource for health employment and distribution coupled with financially poor citizenry that seek the services of hospitals owned by faith based organization has been a compelling datum to pursue efficient ways of providing healthcare. Therefore, the question on how the scarce resources allocated to the hospitals owned by faith based organizations are been utilized, has been of urgent need for address. This study sought to unravel the technical and scale efficiency of hospitals owned by faith based organizations in Kenya. The study employed the Data Envelopment Analysis which is either input oriented or output oriented. Input orientation was adopted for this study. The input variables included medical officers, nurses, beds and cots and an aggregate of other hospital workers; while the number of inpatients and outpatients were the output variables for the analysis. The sample size included 30 FBO hospitals drawn from the Kenya Conference of Catholic Bishops (KCCB), the Christian Health Association of Kenya, (CHAK) and the Supreme Council of Kenya Muslims (SUPKEM) as the major FBO blocks in the country. The results were that only 36.67 percent of FBO hospitals were operating efficiently under the Variable Returns to scale technical efficiency. Scale efficiency revealed that approximately 20 percent of the FBO hospitals were scale efficient. Tn general the study concluded that if FBO hospitals operated as a group, the technical efficiency would be 79% while scale efficiency would be 59 percent. The key recommendation of this study is that FBO hospitals and the other health facilities need to have a yearly efficiency analysis to ascertain proper resource allocation. The desired goal for Kenya's Vision 2030 and the millennium development goals is to provide efficient and reliable healthcare that will reduce child mortality rates, improve maternal health and ~ombat HIV/AIDS, Malaria and other diseases by the year 2015. Kenya's health care sector has been among the most inefficient in the world characterized by high disease prevalence, high mortality rates, low life expectancy, and poor access to healthcare services and corruption. Addressing the above challenges and attaining the millennium development goals on reduction of child mortality rates, improvement of maternal health and combating of HIV/AIDS makes efficiency in health care services delivery a requisite obligation in addition to sound government policies and stakeholder goodwill. Hospitals owned by the faith based organizations are a vital component of health care institutions in Kenya. They form a key component of the private sector healthcare provision with about 40 percent dominance. The operations of these hospitals depend on donor funding, user fees and government subsidies. Dwindling donor assistance, falling government subsidy, poor human resource for health employment and distribution coupled with financially poor citizenry that seek the services of hospitals owned by faith based organization has been a compelling datum to pursue efficient ways of providing healthcare. Therefore, the question on how the scarce resources allocated to the hospitals owned by faith based organizations are been utilized, has been of urgent need for address. This study sought to unravel the technical and scale efficiency of hospitals owned by faith based organizations in Kenya. The study employed the Data Envelopment Analysis which is either input oriented or output oriented. Input orientation was adopted for this study. The input variables included medical officers, nurses, beds and cots and an aggregate of other hospital workers; while the number of inpatients and outpatients were the output variables for the analysis. The sample size included 30 FBO hospitals drawn from the Kenya Conference of Catholic Bishops (KCCB), the Christian Health Association of Kenya, (CHAK) and the Supreme Council of Kenya Muslims (SUPKEM) as the major FBO blocks in the country. The results were that only 36.67 percent of FBO hospitals were operating efficiently under the Variable Returns to scale technical efficiency. Scale efficiency revealed that approximately 20 percent of the FBO hospitals were scale efficient. Tn general the study concluded that if FBO hospitals operated as a group, the technical efficiency would be 79% while scale efficiency would be 59 percent. The key recommendation of this study is that FBO hospitals and the other health facilities need to have a yearly efficiency analysis to ascertain proper resource allocation.